The U.K. government said Thursday that it was willing to take an equity stake of up to 25% to help rescue Tata Steel Ltd.’s U.K. operations, taking a step toward partially nationalizing the business decades after it was privatized by Margaret Thatcher.

The government said it was willing to offer hundreds of millions of pounds in financial support for a potential buyer to help save an industry that has been battered by an increase in cheap Chinese imports and rising costs. It said it expected to provide support through debt financing but that other options could include taking a minority stake of up to a quarter of the business.

Mumbai, India-based Tata Steel, Europe’s second-largest steel producer behind ArcelorMittal, announced earlier this month that it was selling its British plants, including the U.K.’s largest in Port Talbot, Wales, because of their deteriorating financial performance, putting thousands of jobs and the future of steelmaking in Britain in question.

Prime Minister David Cameron’s government has said it is committed to helping find a buyer for the struggling business but has repeatedly said it doesn’t think nationalization is the solution. The opposition Labour Party and its union backers have called for the state to take control of the business, at least temporarily, while it weathers the tough global steel market conditions driven by low demand and prices and massive overproduction, particularly in China.

Unless Europe gets serious about dealing with Chinese dumping, any money pumped into the UK steel business amounts to sending good money after bad. The loses will just continue as it is impossible to compete with dumped steel.